Macroeconomic Factor

Written By:
Paul Tracy
Updated September 30, 2020

What is a Macroeconomic Factor?

A macroeconomic factor is a characteristic, trend or condition that comes from or applies to a broad aspect of an economy rather than a certain population.

Macroeconomic Factor Example

Common macroeconomic factors include gross domestic product, the rate of employment, the phases of the business cycle, the rate of inflation, the money supply, the level of government debt, and the short-term and long-term effects of trends and changes in these measures.

Why a Macroeconomic Factor Matters

Expectations about macroeconomic factors play a considerable role in an economyEconomists and analysts often look at macroeconomic factors when they are searching for ways to explain or meet economic policy goals and create economic stability. In doing so, they often attempt to predict future levels of employment, inflation and other key macroeconomic factors. These predictions affect decisions made today by governments, individuals and companies.